In Star Trek (2009) there is a mysterious substance called Red Matter that is able to create spontaneous singularities. These singularities are able to contain supernovae that threaten the galaxy, allow time travel to alternate realities, and can crush experimental, Borg-inspired mining vessels.

But what exactly is this Red Matter goo supposed to be? And where did it come from?

3 Answers
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The comic mini-series Countdown covered the period in the 24th century leading up to Nero and Spock's ships falling into the black hole. From the Red matter article on Memory-Beta:

Red matter was a substance that was created through the use of Decalithium. It was created by the Vulcan Science Academy and took the form of a red liquid substance that collected in the form of a sphere. A single drop of this compound was capable of creating a singularity.

I should point out that since it's from a comic book, it's quasi-canonical. All we know about the red matter is its effect in the movie.

Well the Romulan warships use a trapped singularity for their warp drives instead of the M/AM reactors of the Federation. So they would need a way to generate them as opposed to find and trap them in the wild. That would necessitate them having some sort of technology to generate them. The Red Matter could be the latest revision of that technology, originally intended as an Olive Branch from the Vulcans to the Romulans.

This technology would alleviate the need to generate a new singularity as ships come off the line, possibly removing a time consuming, resource heavy or environmentally damaging industry. With that much Red Matter the Romulans could also rebuild from their losses during the Dominion War faster. Especially if the process of generating singularities causes them to have a much lower build rate for warp capable than the Federation or Klingons, they may look to destabilize their neighbors through intrigue to maintain their dominance.

Allowing them to "Catch Up" to their neighbors with this limited supply of Red Matter would head off attempts to destabilize the Federation and their neighbors.

It is a nod to the mythical "Red Mercury" invented in the 1980s to fool would be nuclear terrorists into wasting their monies on rust-contaminated mercuric dust. (Forget the actual chemical) nevertheless a reference to a persistent cold war myth and a poke at conspiracy theorists.